U.S. equities rebounded on Friday, shaking off a lackluster start to trading in 2025. The S&P 500 index saw a rise of 32 points, edging close to the 5,900 mark by mid-morning, while the tech-focused Nasdaq surged by 120 points, representing a gain of approximately 0.7%, hovering around the 19,400 level. Investors appeared unfazed by recent worries about rising inflation, which had propelled bond yields upwards in preceding months. The 10-year U.S. Treasury note experienced a marginal drop of one basis point on Friday, following a significant increase of nearly one percentage point since mid-September. Elevated inflation diminishes the allure of fixed income generated by bonds, causing yields to climb as bond prices decline.
Producers of alcoholic beverages suffered notable declines in their stock prices after the U.S. surgeon general urged these companies to incorporate warnings regarding cancer risks on their products. Shares of Anheuser-Busch InBev, the parent firm of renowned brands such as Budweiser and Corona, saw a decline of 2.2%, while Diageo, the manufacturer of popular hard liquor labels like Johnnie Walker, Guinness, and Smirnoff, experienced a decrease of 3.5%.
Additionally, a report from the Institute for Supply Management revealed a strengthening in economic activity within the manufacturing sector in December. Despite this improvement, the report indicated a modest contraction within the industry.
Rivian Automotive, Inc., witnessed a notable surge of over 16% in mid-morning trading subsequent to surpassing analysts’ expectations for car deliveries. This positive performance announcement came after competitor Tesla Inc. reported its initial annual drop in deliveries in 2024.
In summary, U.S. stocks exhibited resilience and advanced on Friday, with the Nasdaq leading the charge despite challenges faced by certain industry sectors such as alcoholic beverage producers grappling with regulatory concerns. Economic indicators pointed to mixed signals, with manufacturing showing signs of improvement albeit with some areas of contraction. The automotive sector saw contrasting fortunes, with Rivian Automotive excelling while Tesla Inc. encountered challenges in delivery numbers.
